ANOTHER VIEW

Some competition styles are controversial but legal

Chip Mather

True or false: The competitive standard for federal government acquisition is full-and-open competition.

If you answered true, you're behind the times. It's true that the foundation for competitive requirements is still the Competition in Contracting Act. It initially established three standards of competition'full-and-open, full-and-open after exclusion of sources, and other than full-and-open. But acquisition has changed radically in five years, and now a range of competition styles is legal.

It's business

Here's a summary of the new ones:
First is competition under the General Services Administration Federal Supply Schedule contracts. As defined by the CICA, GSA awards schedule contracts using competitive procedures. Orders against these contracts need not meet the competitive requirements of Federal Acquisition Regulations, Part 6, nor be abstracted in Commerce Business Daily. But FSS procedures establish a competitive process for placing certain orders and for establishing blanket purchasing agreements using FSS contracts.

In general, for orders above the micropurchase threshold of $2,500 but not exceeding the contract's variable maximum order threshold, ordering offices use GSA's online shopping service or review at least three schedule contractors' price lists.

For orders above the maximum order threshold, buyers must consider more than three potential contractors. FSS contracts also include so-called special ordering procedures, among them competitive processes. Understanding them requires familiarity with the contracts' terms and conditions.

A second new type of competition concerns micropurchases. They are exempt from CICA's full-and-open competition mandate; they may be awarded without soliciting quotations if the ordering authority considers the price reasonable.

A third type is competition under simplified acquisition procedures. CICA and FAR Part 6 competitive rules do not apply to acquisitions conducted under the simplified acquisition procedures of FAR Part 13. A different competitive standard is used: maximum practicable competition.

Under simplified acquisition procedures, the method of ensuring maximum practicable competition is closely related to how the acquisition is publicized. Some agencies prefer to go online, which dramatically expands the competition and often generates enormous response and increases the cost of low-dollar-value procurements.

Agencies have an alternative: FAR 13.104(b) says that you can get maximum practicable competition 'by soliciting quotations or offers from sources within the local trade area.' Three sources are sufficient in this case.

The fourth competition style comes under what FAR calls 'the special test program for simplified acquisitions for certain commercial items.' Under this authority, acquisitions above the simplified acquisition threshold but below $5 million are exempt from all FAR Part 6 competition requirements, except those for sole source justification. Such acquisitions should achieve maximum practicable'as opposed to full-and-open'competition, but buyers must still justify sole-source buys.

Is fair fair?

Task and delivery order contracts have two levels of competition. In the competition establishing the buying vehicle, several vendors are awarded contracts. Subsequently, buyers must use competitive procedures to decide which contractors will get a given order. This second level of competition is known as the fair opportunity process.

Fair opportunity procedures need not comply with the competition requirements of FAR Part 6, nor must the buying agency contact every contractor about every upcoming order.

This type of competition has brought great efficiencies to federal acquisition. By and large, agencies respect the fair opportunity process. But abuses have occurred, and oversight agencies and Congress are examining fair opportunity in federal contracting. Expect the latest General Accounting Office report in January.



Chip Mather, a former Air Force acquisition official, is senior vice president of Acquisition Solutions Inc. of Chantilly, Va. E-mail him at chipmather@acqsolinc.com.

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